PUNJAB & HARYANA HIGH COURT
S.P.Kurdukar and N.K.Sodhi JJ.
United India Insurance Company Limited
Versus
Narinder Mohan Arya
Letter Patent Appeal No. 344 of 1991,
Decided On : MARCH 16, 1994
WRIT JURISDICTION - INSURANCE COMPANY - GENERAL INSURANCE (CONDUCT, DISCIPLINE AND APPEAL) RULES, 1975 - ANTE-DATING INSURANCE COVER NOTE - RES JUDICATA - ISSUE ESTOPPEL - WRIT COURT'S INTERFERENCE WITH FINDINGS OF FACT - SCOPE AND EXTENT.
Fact of the Case:
Narinder Mohan Arya, an employee of United India Insurance Company, was charged with ante-dating an insurance cover note to benefit M/s. Aman Singh Munshi Lal. The disciplinary proceedings resulted in his removal from service. He challenged the order in a writ petition, relying on a civil court finding that the cover note was not ante-dated.
Finding of the Court:
The court held that the United India Insurance Company was amenable to writ jurisdiction under Article 226 of the Constitution of India, based on the tests laid down by the Supreme Court in Ramana Dayaram Shetty v. The International Airport Authority of India and Ajay Hasias v. Khalid Mujib. The court also held that the finding of the civil court that the cover note was not ante-dated operated as an issue estoppel against the Insurance Company, and that the writ court was justified in interfering with the findings of fact made by the disciplinary authorities.
Issues: 1. Whether the United India Insurance Company is amenable to writ jurisdiction under Article 226 of the Constitution of India? 2. Whether the finding of the civil court that the insurance cover note was not ante-dated operates as res judicata or issue estoppel against the Insurance Company? 3. Whether the writ court can interfere with the findings of fact made by the disciplinary authorities?
Ratio Decidendi: 1. The court held that the United India Insurance Company is a State within the meaning of Article 12 of the Constitution of India, and is therefore amenable to writ jurisdiction, based on the following factors: - All the shares of the Company are transferred and vested in the Central Government free of trust and liabilities. - The monopoly on insurance business is created in favour of the four companies. - The officers and other employees of the Company are deemed to be public servants. - The indemnification by the Central Government of the acquiring companies etc. 2. The court held that the finding of the civil court that the insurance cover note was not ante-dated operates as an issue estoppel against the Insurance Company, as it was a finding between the parties and particularly between the defendants inter se. 3. The court held that the writ court can interfere with the findings of fact made by the disciplinary authorities if it is shown that either the principles of natural justice were violated or the findings were contrary to law.
Final Decision: The court dismissed the Letters Patent Appeal filed by the Insurance Company, upholding the decision of the learned Single Judge to allow the writ petition and set aside the order of removal of Narinder Mohan Arya from service.
S.P.Kurdukar, J.
1. This Letters Patent Appeal has been filed by United India Insurance Company Ltd., (hereinafter referred to as the Insurance Company) challenging the correctness of the judgment and order dated February 21, 1991, passed by the learned Single Judge in Civil Writ Petition No. 3232 of 1981.
2. Narinder Mohan Arya, respondent (the writ petitioner), in the year 1976 was working as Inspector Grade-II with the Insurance Company, the appellant. He filed Civil Writ Petition No. 3232 of 1981, challenging the legality and correctness of the order of removal from service made by the Insurance Company after holding disciplinary enquiry against him. The appellate and the revisional Authorities confirmed the order of removal of the petitioner from service. The disciplinary proceedings were taken up against the petitioner pursuant to the charge-sheet dated 11.1.1978 (Annexure A) to Annexure P3 to the writ Petition. Articles of charges read thus:-
"M/s Aman Singh Munshi Lal of Hansi despatched a consignment of 50 bales of cotton from Hansi to Phulwari Sharif through Hansi Public Carriers Union, Hansi on 21.10.1976. While the aforesaid bales of cotton were lying at Delhi-Gaziabad border in the compound of M/s. Milap Transport Roadways in transit to destination, on 22nd October, 1976, at about 11.45 A.M. , a fire broke out in which the said bales were burnt. On being approached by or on behalf of M/s. Aman Singh Munshi Lal to issue an insurance cover in respect of the aforesaid bales after fire had broken out and knowing that fire had broken out in which the said bales had been burnt, Narinder Mohan Arya, issued cover note No. 009643 covering a risk of Rs. On lac in respect of the aforesaid cotton bales purporting to show that the same had been issued on 21.10.1976 even though the same had been issued after the fire broke out on 22nd October, 1976 at about 11.45 A.M."
In the opinion of the Senior Divisional Manager of the Insurance Company, the appellant, the above act of Narinder Mohan Arya, is an act of misconduct which falls under Sub-rule (1), (5) and (20) of Rule 4 of the General Insurance (Conduct, Discipline and Appeal) Rules, 1975 (hereinafter referred to as the 1975 Rules) Narinder Mohan Arya denied the charges. He filed a detailed written statement on 25.1.1978, in which he has stated that he issued the insurance cover note on 21.10.1976, and he had not either ante-dated or prepared the same after fire was broken out.
3. On the basis of the above charges, Inquiry Officer conducted the enquiry and after examining the oral and documentary evidence adduced by the Parties, vide his report dated 5.5.1979, Annexure P5, held that the insurance cover note was actually issued on 22.10.1976, that is, after it was known to the insured that his goods had been damaged by fire. Hence, the charges levelled against Narinder Mohan Arya were proved and, accordingly, the Inquiry Officer held him guilty of the charge of ante-dating the cover note in question. The Divisional Manager thereafter gave opportunity to the writ petitioner to give his written explanation as regards the finding recorded by the Inquiry Officer. The Divisional Manager vide his communication dated 24.7.1979, Annexure P6, accepted the findings given by the Inquiry Officer, and in view of seriousness of the misconduct of Narinder Mohan Arya, awarded the punishment of removal from service. (See Annexure P6). On 28.8.1979, the petitioner preferred an appeal to the Appellate Authority but the same was dismissed on 15.10.1980. Thereafter. Narinder Mohan Arya preferred memorial, which was also rejected on 23.4.1981. It is this action of the Insurance Company, which was sought to be challenged in the writ petition filed sometime in February 1981. The learned Single Judge vide his impugned judgment and order dated February 21, 1991, allowed the writ petition and set aside the order of removal of Narinder Mohan Arya from service. It is this judgment and order of the
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